Warren Buffett’s bio “The Snowball” and lessons for startups | Hacker News Reader

Warren Buffett’s bio “The Snowball” and lessons for startups

andrewchenblog.com

23 pointspeter12310 comments

I think it's interesting that Andrew considers 8 years a long time to build a company. I think if you look at Buffett, the reason he's so rich is because those first 8 years were just the beginning.

Im currently reading this book and there is one point that is off with this post.

"2. Who cares what other people think? Boring businesses can win big"

While I agree with the point, Buffett was very sensitive of what people thought.

I've always heard Buffett emphasizing being rational instead of going with the crowd - even being contrarian.

But I haven't read "The Snowball" - does he reveal something different about it there? (e.g. overcompensation for insecurity?)

What I recall from his other writings is that he suggests watching the market, but with different eyes from the crowd. A company with sound fundamentals that suffers bad market news is a buying opportunity. The opposite is harder to find, and the bulk of the profit from his approach comes from time, not timing, so he does not actively look for it.

His mother had emotional issues and he took some verbal abuse as a child. This led Buffett to go out of his way to be liked by others and avoid confrontation at all costs.

That's in his personal life (and is probably why he is so well-liked); but in business decisions, he buys when others are selling (and vice versa). He closed up his first partnership, depressed, because the stock market was booming. He has described himself as being excited when the market falls. (but maybe much of this contrarianism comes from his partner, Charlie Munger, and his mentor Benjamin Graham?)

I think he also supported breaking a strike (at the Washington Post). That ain't nice stuff, and I think he vowed never to get into that situation again. But he did get into the first time.

I think he also supported breaking a strike (at the Washington Post). That ain't nice stuff

What's not-nice about that? Letting a cartel exploit its customers seems like the moral low ground.

If you confront strikers, they won't like you - see the context of this thread.

Buffett deserves a lot of admiration, he certainly built his early cash hoard with hard work and grit.

However, he was born on an upward slope fed by historical circumstances such as the destruction of the industrial base in many countries as a result of WWII while America was mostly untouched; by the growth of fiat currency unencumbered by being tied to gold or silver; by the increase in the value of human labor due to (again) WWII and productivity increases of automation.

Now that many of those growth curves have flattened out, I am wary of following WB too closely - I worry that the lessons of the old economy will not work in the new, diminished age that is upon us.

He's been investing since the 50s. How many times in his long career could someone have told him "the world is fundamentally different now, and your old strategies won't work"? Many times.

The fundamental business of Berkshire Hathaway is this: get cheap cash (float) from the insurance business and use it to buy high-quality companies. Berkshire's inflow of cheap cash is unrivaled, and it has an extremely good reputation as an acquirer. In the "new, diminished age," I think those factors are even more important.

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